In this file:
· US farm income projected to rebound in 2019
· Farm Income Below $70 Billion — A New Average for U.S. Agriculture?
US farm income projected to rebound in 2019
via France24 - 06/03/2019
(AFP) After a challenging year due to tariffs on American soybeans and pork, US farmers are expected to see incomes rise in 2019, a government forecast said Wednesday.
Net cash farm income is projected to increase 4.7 percent in 2019 to $95.7 billion, according to US Department of Agriculture forecasts, after dropping 9.6 percent in 2018 due in part to higher expenses.
Even with the increase, income will still be far from the record $136 billion set in 2013.
Overall farm cash receipts are expected to rise 2.3 percent, with items like milk, cattle/calves, corn, and fruits and nuts benefiting from higher commodity prices.
But fallout from the trade conflicts will continue to weigh on soybeans and hogs, where cash receipts are projected to fall 6.6 percent and 3.2 percent in 2019.
These items have been caught in the cross-fire of US trade disputes, after China essentially boycotted US soybeans and Mexico hit pork with retaliatory tariffs, after US President Donald Trump imposed duties on steel and other items.
Forecasters expect overall federal farm program payments to decrease 16.8 percent...
Farm Income Below $70 Billion — A New Average for U.S. Agriculture?
By Chuck Abbott, Successful Farming
Agriculture.com - 3/7/2019
The USDA forecast net farm income, a broad measure of profits, of $69.4 billion this year. If accurate, the total would be the third year of net income below $70 billion since 2015. “We’re starting to see … a new average coming out here,” said USDA economist Carrie Litkowski during a webinar on Wednesday.
Farm income in 2019 will be far below the halcyon levels of early this decade, when a seven-year commodity boom propelled income to a record $123.4 billion in 2013 before collapsing due to abundant harvests worldwide. “In 2019, global production will continue to expand, trade challenges will persist, and these factors will continue to impact commodity prices,” said Agriculture Secretary Sonny Perdue in House testimony last week. “As a result, many farmers will continue to face tight bottom lines with fewer resources.”
Groups such as the National Farmers Union are calling for a stronger farm safety net because of sharply lower commodity prices. But some analysts say that while income may be in a rut, the sector is sound financially.
In this, its first forecast of 2019 farm income, the USDA said that higher market prices would mean larger crop and livestock receipts for producers than last year. Livestock production also is expected to rise, helping to generate revenue. Production expenses will rise fractionally, and government payments, which hit a 12-year high of $13.8 billion in 2018, are projected to fall by $2.3 billion. Termination of the so-called Trump tariff payments would account for most of the decline in government payments.
Although farm debt is rising, so are farm assets. The debt-to-asset ratio, an indicator of stress, is forecast by the USDA to be 13.9 percent this year. This would continue a rise that began in 2012, although the ratio is still comparatively low. During the farm recession of the 1980s, the debt-to-asset ratio peaked at 22.9 percent in 1985. Land is often a farmer’s largest asset, and overall it accounts for more than 80 percent of assets for the sector. Federal Reserve banks in the Farm Belt say land values were stable going into this year.
When asked about the near-term outlook for farm income, Litkowski said, “We’re starting to see, you know, kind of a new average coming out here, especially if you take out the unusually high years around 2013 and 2014. Then the value we’re forecasting really isn’t that far off what we’ve seen in previous years.” Income was pegged at $61.5 billion in 2016, $75.2 billion in 2017, and $63.1 billion in 2018.
“What it means for the future, once we get away from discussing what happened in the peak years of farm income,” said Litkowski...